India’s National Securities Depository (NSDL) has launched a blockchain-based security and covenant monitoring platform.
The National Securities Depository and the Securities and Exchange Board of India (SEBI) officially rolled out a platform based on distributed ledger technology (DLT).
SEBI Chairman Madhabi Puri Buch emphasized that the platform was designed to strengthen security and governance controls in the corporate bond market to bring “further discipline and transparency to the market.”
A key advantage of using blockchain technology is its transparency. However, Buch stressed that the potential anonymity of DLT users is not cost-effective to use in a central bank digital currency (CBDC) context. Hence, it remains highly undesirable to Indian authorities.
The NSDL and SEBI’s Central Depository Services Ltd. (CDSL) will oversee the network. At the initial stage, the platform will be supported by only two nodes, but later the number may increase.
The NSDL is the oldest depository in India and controls 89% of the country’s securities market. All the previously stored information in centralized databases will be cryptographically signed and recorded in a distributed ledger.
Recall that in December 2021, the Indian government initiated the creation of a “national blockchain.”
